Russian mining and steel group Mechel has announced its consolidated financial results for 2016. In the given year, Mechel saw a net profit of RUB 7.13 billion ($125.98 million) compared to a net loss of RUB 115.16 billion in 2015. In 2016, Mechel's sales revenues increased by seven percent year on year to RUB 276 billion ($4.88 billion), while its EBITDA rose by 45 percent year on year to $66.16 billion ($1.17 billion).
The revenue of Mechel's mining segment from external customers in 2016 totaled RUB 89.64 billion ($1.58 billion), up 11 percent, while its steel segment's revenue from external customers in the same year amounted to RUB 161.64 billion ($2.86 billion), up 11 percent, both compared to the previous year.
In 2016, Mechel's mining division significantly improved its financial results as the global coking coal market rapidly recovered. The company stated that the surge in metallurgical coal prices which began in the middle of the year halted only in mid-December. Prices for high-quality coking coal topped $300/mt. This means that prices nearly quadrupled over the year, rising from historical lows to peak levels last seen in 2011. Mechel expects its coal mining volumes to remain stable in the current year compared to last year’s level. Regarding its steel segment, the company stated that the chief factors that had a positive impact on the division’s results were a favorable market situation and optimization of its product range in favor of high-margin products.